Introduction to the Use of General Equilibrium Analysis

This book highlights the uses of general equilibrium theory for policy analysis. The bases for such simulation models are examined, including fixed-point algorithms, relations between competitive, market solutions and voluntary bargaining solutions, description of efficient and fair solutions including possible externalities and the use of consumer surplus, and Debreu's coefficient of resource utilization to evaluate an economy's performance. Readers are shown how to use the axiomatic method, and are given a survey of the mathematics nedded for the advanced parts of the text. Bibliographical sketches illustrate the methods and ideas of prominent economists in this field. Problems at the end of each chapter give students the chance to practice and tackle extensions of the concepts presented.